Economist 12/31/15

1. Over the past two years, as its relations with the West have soured, Russia has proclaimed a “pivot to the East”. Officials envisioned China replacing Western capital markets and hoovering up Russian exports of oil, minerals and food.The Russian recession and China’s slowdown have put a damper on grand plans. With oil prices low and the rouble weak, bilateral trade shrank by around 30% in the first half of 2015.The clash with the West over Ukraine turned Russia’s focus eastward again. In May 2014, two months after the annexation of Crimea, Mr Putin met Mr Xi and announced a 30-year, $400 billion gas deal, ending a decade of talks. Russia’s rail monopoly awarded a tender to the state-controlled China Railway Group to design a high-speed train between Moscow and Kazan.But it has not exactly been a gold rush. Western sanctions have made Chinese lenders cautious about Russian firms.Russia, meanwhile, frets about being exploited.Chinese businessmen complain about restrictions on hiring foreign labourers.
2. AMERICA incarcerates people awaiting trial at triple the world average. Every day, roughly 500,000 people who have been convicted of no crime sit in county jails. Some are there because a judge determined they were too dangerous to return to the streets. But the vast majority end up behind bars because they could not afford to post “bail”, a returnable payment designed to ensure they’ll show up for their court dates.Few people outside the rather brazen bail-bond industry have nice things to say about the present system. The American Bar Association urges judges to ask for cash bail “only when no other less restrictive condition of release will reasonably ensure the defendant’s appearance in court”. Bail systems like the one being challenged in California also have the perverse effect of encouraging some innocent defendants to falsely claim guilt in a plea bargain.
3. Most victims of war and terrorism in the Middle East are Muslims, since they are by far the majority of the population. But the tiny Christian minority often feels singled out.Overall, the proportion of Middle Easterners who are Christian has dropped from 14% in 1910 to 4% today.Many Christians feel more at home in the West and have the means to get there. Some are leaving because of the general atmosphere of violence and economic malaise. Others worry about persecution.The Christians who remain tend to have fewer babies than their Muslim neighbours, according to the Pew Research Centre. Regional data are unreliable, but in Egypt the fertility rate for Muslims is 2.7; for Christians it is 1.9.Mosul, in northern Iraq, was once home to tens of thousands of Christians. Perceived as supporting the Americans, they were targeted by insurgents after the invasion.In the decades before the Arab spring, many Christian leaders lent their support to authoritarian rulers in return for the protection of Christians—and their own lofty status. But the deals broke down when the dictators fell or wobbled.
4. Christian leaders have often supported whichever strongman is in power. The late Pope Shenouda III, head of the Coptic church, the largest in the Middle East, backed Hosni Mubarak, Egypt’s former dictator.Yet the Copts have gained little from their leaders’ loyalty. Mr Mubarak stood by as relations between Christians and Muslims deteriorated and sectarian violence increased. Even in Lebanon, where Christians were once a majority and still hold considerable power, their political leaders have disappointed. Under the country’s unique system, government posts are shared out based on sect.Oddly enough it is the Gulf, home to the most conservative brand of Islam, which has welcomed the largest number of Christians recently, though not from Iraq or Syria.Saudi Arabia, for example, bans the practice of Christianity (though many Christians worship in private). The UAE restricts proselytisation, but has otherwise supported its Christians.
5. After years of squabbles and delays, development of the Oyu Tolgoi copper and gold mine in the Gobi desert, by far Mongolia’s biggest investment project, seems to be back on track with the signing on December 15th of a new financing package worth $4.4 billion.The mine, boasting a copper deposit that is among the world’s biggest and purest, is controlled by Rio Tinto, a British-Australian firm, with the Mongolian government holding a 34% stake.But four-fifths of the project’s value may lie underground.This week’s financing deal, which involves 15 commercial banks and the American, Canadian and Australian export-credit agencies, will allow work to begin on the underground mining phase.Mongolia is not out of the woods yet. Hard currency remains in short supply, inflation is stubbornly high and the budget deficit is way above the target of 2% of GDP, despite tax rises and cuts in public-sector pay. Above all, the country’s political turbulence is all but certain to continue.Mongolian People’s Party will appeal to Mongolians’ sense of nationalism over mining.

Economist 12/30/15

1. China’s GDP per person is about one-seventh of America’s. But in 2014 Chinese gave 104 billion yuan ($16 billion) to charity, about one-hundredth of what Americans donated per person.Charitable giving is not yet a middle-class habit. Many people still feel awkward about it, despite their growing prosperity.The middle classes have worries too—that giving large amounts to charity may draw unwanted attention to their wealth. They do not want to fuel the envy of the have-nots or encourage tax collectors to pay them closer attention.Yuan Yuan, the organisation behind the plastic pandas.They are large, bear-shaped receptacles, designed to entice people to donate their unwanted garments to those in need. First deployed in 2012, there are now hundreds around Shanghai, often placed by entrances to apartment buildings. They swallowed about a million items of clothing last year.
2. The China Philanthropy Research Institute estimates that fully 80% of donations by the wealthiest Chinese go to overseas charities. Many may well prefer to give to local causes, but regulations have hindered the development of philanthropy at home. To function as a not-for-profit organisation, charities must have a government partner, which entails the loss of their autonomy. It is also difficult for them to obtain tax breaks for their donors.
3. AFTER sun and sand, the West Indies Test cricket team may be the best known symbol of the English-speaking Caribbean. From 1980 to 1995, the side was unbeaten in 29 consecutive series it played. Since June 2000 they have won just 14 Test matches and lost 81 against the top eight countries—a record so miserable that the team’s very survival is now in question. There is speculation that Trinidad and Tobago will leave the West Indies team and form its own. On November 4th a review by Caricom called the West Indies Cricket Board (WICB), which runs the team, “obsolete” and recommended its dissolution.Globalisation is one culprit. In the 1980s, national Test teams were seen as the pinnacle of the sport. But the advent of for-profit domestic club leagues playing shorter Twenty20 (T20) games, particularly the Indian Premier League (IPL), has lured players away from Test cricket.Six of the Windies’ leading players are now in Australia—competing for domestic T20 clubs rather than their Test side.The WICB is guilty of self-inflicted wounds.Coaches routinely disagree with the WICB over the selection of players. And its Byzantine structure has made even simple tasks, like scheduling matches, difficult.
4. On December 27th an assembly of the far-left Popular Unity Candidacies (CUP) party deciding whether to back Catalonia’s acting president, Artur Mas, split the vote evenly—1,515 on each side. The deadlock means that, three months after elections, Mr Mas still cannot form a government to carry out his programme of moving steadily towards secession from Spain.The Catalan impasse is part of a wider Spanish gridlock. Elections on December 20th splintered the political landscape. The duopoly of the conservative People’s Party (PP) of the prime minister, Mariano Rajoy, and the opposition Socialists (PSOE), who have traded turns in power for the past 33 years, has been upended. The insurgent left-wing Podemos and liberal Ciudadanos parties grabbed a third of the parliamentary seats between them, making a coalition or minority government a necessity.
5. Following mandatory safety requirements introduced on December 21st. More than 45,000 people registered their personal UAVs (unmanned aerial vehicles) in the first few days.Registration, which applies only to recreational UAVs, costs $5 (waived for those registering before January 21st) and is good for three years. Existing drone-owners and aeromodellers have until February 19th to comply.The directive makes it an offense for anyone to fly a UAV above 400 feet (122 metres) and within five miles (8km) of an airport, unless special permission is received from the airport tower.Reports of recreational UAVs interfering with regular air traffic have been running at over 100 a month of late.Though none has to date, the risk of a drone being ingested by a jetliner engine and causing a fatal accident is all too real. Bird strikes are bad enough. One of the most feared birds encountered by aircraft is the common Canada goose, weighing anything up to 6kg.Over the past year, American pilots have reported some 700 close encounters with UAVs of one sort or another. That pales almost into insignificance when compared with the 13,700 bird strikes in America last year.The biggest aviation threat of all comes when passenger planes are taking off or landing, or when helicopters have to operate close to the ground while fighting fires, rescuing accident casualities or pursuing criminals.Unfortunately, a drone’s small size makes it difficult for a pilot to spot visually. Its little electric motor makes it hard to detect acoustically. And being made mostly of plastic, it is practically invisible to radar.Drones are an order of magnitude more difficult for pilots to notice.

Economist 12/29/15

1. LAST month Kai Krause, a computer-graphics guru, caused a stir with a map entitled “The True Size of Africa”, which showed the outlines of other countries crammed into the outline of the African continent. Most people do not realise how much the ubiquitous Mercator projection distorts the relative sizes of countries.A sphere cannot be represented on a flat plane without distortion, which means all map projections distort in one way or another.Gerardus Mercator’s projection, published in 1569, was immediately useful because it depicts a line of constant bearing as a straight line, which is handy for marine navigation. The drawback is that it distorts the shapes and areas of large land masses, and the distortion gets progressively worse as you get closer to the poles. (Africa looks about the same size as Greenland under the Mercator projection, for example, even though it is in fact 14 times bigger.)
2. IT SEEMS a country’s spending reflects its national stereotypes, according to household expenditure data compiled by Eurostat: Russians splash 8% of their money on booze and cigarettes—far more than most rich countries—while fun-loving Australians spend a tenth of theirs on recreation, and bookish South Koreans splurge more than most on education. Some of the differences are accounted for by economics. Richer places like America and Australia, where household expenditure is around $30,000 per person, will tend to spend a smaller share of their costs on food than Mexico and Russia, where average spending is around $6,000. And politics plays a part too. Predominantly private health care in America eats up over a fifth of each household’s budget, whereas the European Union, where public health care is common, only spends 4% on it. In Russia, government-subsidised housing and heating make living cheaper, and this means money is left over for the finer things in life.
3. The Swiss National Bank (SNB) suddenly announced that it would no longer hold the Swiss franc at a fixed exchange rate with the euro, there was panic. The franc soared. On Wednesday one euro was worth 1.2 Swiss francs; at one point on Thursday its value had fallen to just 0.85 francs.The SNB introduced the exchange-rate peg in 2011, while financial markets around the world were in turmoil. Investors consider the Swiss franc as a “safe haven” asset, along with American government bonds: buy them and you know your money will not be at risk.An expensive franc hurts Switzerland because the economy is heavily reliant on selling things abroad: exports of goods and services are worth over 70% of GDP.To bring down the franc’s value, the SNB created new francs and used them to buy euros. Increasing the supply of francs relative to euros on foreign-exchange markets caused the franc’s value to fall.by 2014 the SNB had amassed about $480 billion-worth of foreign currency, a sum equal to about 70% of Swiss GDP.
4. First, many Swiss are angry that the SNB has built up such large foreign-exchange reserves. Printing all those francs, they say, will eventually lead to hyperinflation. Those fears are probably unfounded: Swiss inflation is too low, not too high. But it is a hot political issue.Second, the SNB risked irritating its critics even more, thanks to something that is happening this Thursday: many expect the European Central Bank to introduce “quantitative easing”. This entails the creation of money to buy the government debt of euro-zone countries. That will push down the value of the euro, which might have required the SNB to print lots more francs to maintain the cap.
5. THE bronze statue of a teenage “comfort woman” in Seoul, South Korea’s capital, is intended as a daily rebuke to the Japanese embassy opposite. The figure represents one of many thousands of Korean women who were forced to serve in wartime military brothels catering to imperial Japanese soldiers. Citizens’ groups paid for the figure to be erected in 2011 when relations between Japan and South Korea were at a nadir.Yet now the statue is meant to move elsewhere as part of a landmark agreement struck between South Korea and Japan on December 28th to try to settle their dispute over comfort women once and for all—and transform dangerously strained relations.Of former sex slaves who have come forward in South Korea, only 46 survive. Under the deal, South Korea will set up a fund for them into which the Japanese government will pay $8.3m for their medical and nursing care. The Japanese prime minister, Shinzo Abe, has expressed “sincere apologies and remorse” for the women’s suffering, which was appalling.It is a big change for Mr Abe, who has in the past questioned whether the comfort women were coerced at all. But he seems to have found what the two countries’ foreign ministers called a “final and irrevocable” resolution to an issue that has poisoned the relationship for years.

Economist 12/28/15

1. ON THE face of things, the worst is over for Ukraine. A ceasefire seems to be holding in the war that has left forces backed by Russia in control of much of the east of the country. The IMF has found a way to keep providing Ukraine with a financial lifeline, side-stepping a dispute with Russia that had threatened to sever it.Yet the hryvnia, Ukraine’s currency, which has lost 70% of its value over the past two years, is sliding again; government-bond yields are rising. Politicians in Kiev are busier brawling (at times physically) than fixing the country’s problems.The government’s finances also look much more healthy. That is largely thanks to Ukraine’s creditors. In August most of them agreed to a restructuring that wiped 20% off its foreign debt. That paved the way for an IMF rescue. It has lent $11 billion to Ukraine since the beginning of 2014, and plans to lend another $11 billion by 2019.Dramatic spending cuts have also helped right the government’s finances. The budget is in surplus so far for 2015.Investment is needed to spur exports. In the past three years capital spending has fallen by 40%. It shrank yet again in the third quarter.Efforts to tackle corruption are going less well. No prominent figures from prior regimes have been jailed.Even senior officials are paid a measly $300 a month, making corruption especially hard to resist ($50,000 a month is said to be the going rate for a pliable one).
2. Germany is straining to cope with the 1m refugees who have arrived in the country this year, and for the most part it is managing. But in Germany’s federal system, the 16 regional states must integrate refugees once federal officials have fingerprinted them. Berlin, with an estimated 90,000 refugees this year in a population of 3.5m, is the least competent. It is deep in debt and receives subsidies from other states.
3. In 2015 several of the big democracies that chose new leaders or returned old ones to power would have seen different outcomes had the same votes been counted using a different electoral method.In a winner-take-all district-based method, like that of America, such lopsided provincial victories “waste” votes. Had Argentina used an American-style electoral college, where senators and congressmen cast their votes for the candidate who comes first in their state, Mr Scioli would have won comfortably despite losing the popular vote.Both Britain and Canada, the world’s two biggest “Westminster-style” democracies, also held elections this year. Advocates of this system—a parliament with single-member, winner-take-all districts—argue that it produces stable majority governments; critics argue that it unfairly shuts out smaller parties.
4. Turkey has tried to balance the goals of inclusion and governmental stability by using a proportional-representation system that denies seats to parties that win less than 10% of the national vote. That threshold, the highest in the world, has helped Recep Tayyip Erdogan’s Justice and Development party (AK) win successive majorities since 2002, and brought them tantalisingly close to the “super-majority” of 367 seats.Frustrated by their inability to change the constitution at will, AK leaders have blamed Turkey’s electoral system and suggested shrinking its districts or moving to a Westminster method.espite the differences in their voting systems, the four countries’ elections all shared a common desirable outcome: undisputed control of executive authority by the winners, and an opposition with meaningful power to resist overreach.
5. HARDLY had the group of two dozen winsome North Korean musicians arrived in Beijing, than they were on a flight back home. Their first ever overseas concert, set for December 12th at the National Centre for the Performing Arts.North Korea’s state news agency removed its gushing coverage of the all-female band’s tour from its website. Chinese censors swiftly erased news of the cancellation from their country’s social media.Moranbong is a favourite of North Korea’s leader, Kim Jong Un, who is said to have set it up himself three years ago as a “standard-bearer on the ideological and cultural front”. Its five lead singers, who expose an unusual amount of leg for such a puritanical country.Xinhua, a Chinese state-run news agency, said that the band’s tour had been called off because of “communication issues”.

Economist 12/24/15

1. This approach reflected the first post-war phase in the German treatment of Hitler’s legacy. The idea was to suppress anything that might tempt the Germans to fall back under his spell. The Allies and the new German government followed a policy of “de-nazification”, under which known Nazis were banned from important positions.In the late 1940s and 1950s Germans avoided discussing Hitler. Many men were returning from captivity. Germans had been both perpetrators and victims, and had no words for their state of mind. Many were traumatised and could not bear to talk about their experiences.A new phase began in the 1960s, after the Israelis captured, tried and executed Adolf Eichmann, a leading Nazi. This made more details of the Holocaust public.Official Germany found two responses. East Germany adopted the fiction that its righteous communists had resisted the “fascists” all along. In effect, it never reckoned with the past. But West Germany accepted its guilt and atoned publicly. It became a pacifist society, often called “post-heroic” in contrast to the Allies’ warrior cultures. It also became “post-national”: West Germans rarely flew their flag and barely whispered their anthem at sporting events.
2. But starting in the 1970s a pent-up fascination with Hitler began to re-emerge. Two biographies and a documentary came out, and in 1979 Germany aired “Holocaust”, an American television series.After reunification in 1990—the formal end of the post-war era—the German public became ravenous for more research.For young Germans the Führer has thus receded far enough into the past to seem outlandish and weird rather than potentially seductive.One by one, post-war taboos connected to Hitler are vanishing. Flag-waving is one. A breakthrough occurred in 2006, when Germany hosted the football World Cup. For the first time since the war the black-red-and-gold came out everywhere, draping balconies, prams, cars and bikinis. But so did the flags of the visiting countries, and Germany turned into one big street party. Hosts and visitors perceived it as nothing but fun.
3. In a poll by YouGov this year, Germans were asked what person or thing they associate with Germany. They named Volkswagen first (awkwardly, given subsequent revelations of its cheating). Then came Goethe and Angela Merkel, the chancellor, next the anthem, the national football team and Willy Brandt, a former chancellor. Hitler ranked a distant seventh at 25%. In the same poll 70% of Germans said they were proud of their country. About as many thought that Germany was a model of tolerance and democracy, and that it was time to stop feeling guilt and shame.And yet 75% also said that Hitler’s crimes mean Germany still cannot be a “normal” country and must play a “special international role”. This means that many Germans somehow combine both pride and penance.In contrast to the French, British and Americans, Germans worry a lot about surveillance by governments, whether foreign or German. The anxiety stems from memories of Hitler’s Gestapo.There is also a wide consensus that Germany has a special responsibility towards Israel. Pacifism runs through all mainstream political parties.
4. Domestic life is governed by Germany’s post-war constitution, which was adopted in 1949 as a direct rejoinder to Hitler’s worldview and has become a source of patriotism today. Its first article stipulates that “human dignity shall be inviolable”. This translates into police practices that would count as touchy-feely in America, prisons that resemble low-budget hotels, and one of Europe’s most welcoming policies towards asylum-seekers.This does not mean that Hitler made today’s Germans boring. Official Germany still displays virtues the world considers German, such as punctuality and reliability.Many Germans adopt highly idiosyncratic lifestyles in everything from hobbies to sex. Contrary to stereotype, Germans are often secret eccentrics.
5. Here is, however, an even more intimate domain in which Hitler continues to torment older and middle-aged Germans: their minds. One generation, defined roughly as those born between 1928 and 1947, is called the Kriegskinder (“war children”). The other, born between 1955 and 1970 or so, consists of their children and is called the Kriegsenkel(“war grandchildren”).Much of what seems strange today about some older Germans has roots in these repressed memories, he says.Their children, the Kriegsenkel, have different problems. As they grew up, their parents were often emotionally frozen. The elders came out of the war in a sedated or numb state from which they never fully emerged.This impaired relations with their children, who, by intuiting what must never be said or what was omitted with a sigh, inherited their parents’s trauma.In recent years support groups have formed for the grandchildren of the war. Only about 40% of middle-aged Germans share such “transgenerational” trauma.As “Mein Kampf” loses its copyright, German society is more complex than ever. One in five Germans today has immigrant roots and thus no family link to Hitler’s time. Many of the young know little history and find Hitler alien and fascinating.

Economist 12/23/15

1. With thousands of business schools, a good chunk of which offer a “global” or “international” slant on their MBAs, it can be difficult to differentiate one from another. Every school offering an international or globally-focused programme hopes to train top executives at multinational firms.But, as Mr Mangematin points out, there are more MBA graduates than seats in the c-suites of the best businesses. So he has a counterintuitive suggestion: at a time when everyone is globalising, business schools should narrow their focus in order to thrive.Though the packaging may be the same, courses’ content can change based on where business schools are located. The idea is not to go into ever-more specific niches—the “MBA in something” The Economist has previously explored—but to offer a general education with a hint of one’s surroundings. In that sense, what Mr Mangematin is suggesting is not as radical as it may seem.Students already choose to apply to Stanford, say, because they want to benefit from its proximity to the startup hubs in the San Francisco bay area.
2. On December 18th more progress was made on the path to peace in Syria, as the United Nations Security Council unanimously passed a resolution calling for a ceasefire and talks between the Syrian government and opposition in early January.The measure comes after months of negotiations between world powers, most notably America and Russia, which have been divided over the future of Syria. It is the first time the security council has endorsed a peace plan. And yet it is still far from clear that the agreement reached in New York will result in an end to the fighting.Many questions remain unanswered, the biggest of which concerns the fate of Bashar al-Assad, Syria’s authoritarian president, who is opposed by a patchwork of moderate and radical rebel groups. Elections are to be held within 18 months of the start of talks, according to the resolution, and it has for the moment been left unclear whether Mr Assad would be allowed to run; his position in the interim is also unclear. But Russia, which has bombed his opponents, does not want him removed ahead of time.The ceasefire will not apply to the whole country. Attacks by outside powers on Islamic State (IS) and Jabhat al-Nusra, the local al-Qaeda affiliate, will continue.
3. FACE it, pets and travel don’t mix. The logistics of taking a pet on a trip can get very complex very quickly. First of all there are the legal complications.So animal loving jet-setters will be pleased to read that things are getting better for those wanting to travel with four-legged friends. There are a growing number of services designed to make travelling with dogs easier. Onesuch is “BringFido“, a website and app that lists suitable accommodation in locations that users plan to visit. The site also helps with pet friendly airlines and provides advice or booking services for restaurants and the like. Another is a start-up called “WoofAdvisor“, which is basically a TripAdvisor for dogs.New hotels opened by both chains and boutiques are emphasising their pet friendliness. Some offer dedicated treatssuch as doggy room-service and canine massages.
4. IN GERMANY, as in the rest of Europe, copyright expires seven decades after the author’s year of death. That applies even when the author is Adolf Hitler and the work is “Mein Kampf”. Since 1945, the state of Bavaria has owned the book’s German-language rights and has refused to allow its republication. German libraries stock old copies, and they can be bought and sold. But from January 1st no permission will be needed to reprint it.Mein Kampf” is a mix of autobiography and manifesto that Hitler began writing during a rather comfortable prison stay after his failed putsch of 1923. It was first published in two volumes in 1925 and 1926.But after 1933, when Hitler seized power, it became a bestseller.After the war it fell to the Americans to decide what to do about the book, because Hitler’s last private address, in Munich, was in their sector. The Third Reich was gone and the Federal Republic of Germany would not be born until 1949. So the Americans transferred the rights to the government of Bavaria. It banned printing of the book.

Economist 12/21/15

1. Only 28 prisoners have been executed in America in 2015, the lowest number since 1991. Next, consider the dwindling rate of death sentences—most striking in Texas, which accounts for more than a third of all executions since (after a hiatus) the Supreme Court reinstated the practice in 1976.According to a tally by the Death Penalty Information Centre (DPIC), a lobby group, overall only 49 people were sentenced to death in America in 2015, the lowest total in modern records.The biggest reason, says Richard Dieter of the DPIC, is juries’ nervousness about imposing an irrevocable punishment. Behind that anxiety stands another, unwilling participant in the death-penalty story: the swelling, well-publicised cadre of death-row exonerees.In 2015 alone, six more prisoners have been freed from death row.
2. Capital cases are “a huge drain on resources”, spiralling costs that—especially given juries’ growing reluctance to pass a death sentence anyway—have helped to change the calculus about when to pursue one, Mr Farren says. In 2011 a Californian study estimated that death-penalty trials cost the taxpayer an extra $1m a pop. Guilty verdicts mean lengthy and pricey appeals; death-row prisoners are often incarcerated in expensive isolation.Even when the appeals are exhausted, enacting a death sentence has become almost insuperably difficult—because of an outlandish cameo by the pharmaceutical industry. Obtaining small quantities of drugs for lethal injection, long the standard method, might seem an easy task in the world’s richest country; but export bans in Europe, American import rules and the decision by domestic firms to discontinue what were less-than-lucrative sales lines has strangled the supply.Of the 19 states to have repealed the death penalty, seven have done so in the past nine years. Others have imposed moratoriums, formal or de facto, including, in 2015, Arkansas, Ohio, Oklahoma, Montana and Pennsylvania.
3. AMERICA imprisons 2.2m people—more than any other country in both real and relative terms. About 4.4% of those prisoners, on any given day, are serving time while virtually bereft of human contact. The conditions in solitary confinement are grim: prisoners sit alone in 6-by-10 ft windowless cells for all but an hour or so a day, eating meals that are, themselves, punitive.A chorus of critics say that time in a “special housing unit” (or “SHU”) bringssevere mental and emotional harm to prisoners without making prisons any safer for inmates or staff.  New York’s rate of solitary confinement, at 8%, is nearly double the national average, and prisoners often stay in SHU for months or years. Some of those inmates are especially violent, segregated from the general prison population to avert further crimes. But many end up in solitary confinement for breaking everyday prison rules.
4. All organisations make forecasts and pay attention to the forecasts of others. Yet the accuracy of much of this forecasting—maybe most—has not been determined.Yet when it comes to the forecasting that informs critical decisions, organisations routinely pay without demanding proper evidence of quality.One lesson: don’t overuse what statisticians call the “ignorance prior”, the tendency to say 50% whenever you feel you don’t even know enough to guess. You often do know enough.Another lesson: don’t fall in love with your first estimate. The best forecasters readily update their calls in light of new information. But they also avoid the opposite mistake of assuming this changes everything.
5. SpaceX’s vehicle, one of its Falcon 9 rockets, was sent on its way from Cape Canaveral in Florida at 0129 GMT on December 22nd. This, in itself, was no big deal. Falcons have been travelling into orbit since 2008. What is new is that when the rocket’s first and second stages separated, and the second stage carried on ascending with its payload of 11 satellites, the first stage flipped itself over, re-lit its engines to reverse its course, and headed back to the ground. One reason missions to space are so expensive is that existing rockets are one-shot machines.The first stage of a Falcon 9 accounts for around 70% of its $54m price tag. SpaceX’s going rate for a satellite launch starts at around $60m, already the lowest in the industry, but reusable rockets would allow the company to go even lower.

Economist 12/21/15

1. ELECTION night in Spain on December 20th ended with a disturbingly messy result. Neither the incumbent prime minister Mariano Rajoy, whose conservative People’s party (PP) lost 43 of its 186 seats, nor the Socialists (PSOE) of Pedro Sanchez can form a government without the help of the new insurgents of anti-austerity Podemos or the new liberal party, Ciudadanos. Even that may not be enough. As many as five parties may be needed to form a new government.Sunday’s results confirmed the demise of Spain’s two-party system. PP and the Socialists took just 50% of the vote between them, down from 73% four years ago. The new insurgent parties are not yet strong enough to replace them. But nor can they be ignored.If Spain wants stable government, an agreement between two or three of these parties is the only real option. Otherwise a new government will need the backing of Catalonia’s increasingly belligerent and rebellious separatists who, in yet another blow to the status quo, took a key bloc of seats.
2. If you want to fly a quadcopter outdoors in America, you must now license it, under rules that take effect today. The Federal Aviation Administration says drones weighing 0.55-55lb (0.25-25kg) must be added to an online database by February 19th; a three-year licence costs $5, but signing up is free until January 20th. Drones must display a registration number and be kept at least five miles (8km) from airports and below 400 feet (120 metres)—an altitude most small devices cannot reach anyway.
3. Business, indeed, is the principal business of Gujaratis. Everywhere, they are to be found running businesses, from corner-shops to hotels, from tech start-ups to some of the world’s largest conglomeratesHaving arrived in numbers from the 1960s onwards, Gujaratis now run about a third of all its hotels and motels in America. Furthermore, this was achieved mostly by just one group, essentially an extended family, the Patels.They own almost half (12,000) of America’s independent pharmacies (as well as one of the biggest chains in Britain, Day Lewis). There are thousands of Gujarati doctors in America, and they are quicker than most to start up their own practices.These stories point to a couple of outstanding characteristics. Most fundamentally, those Gujaratis who turn to business say that they are constitutionally unsuited to working for other people.Starting a small corner-shop is seen as more impressive than holding a mid-level management job in somebody else’s company.
4. An impressive 90% of the world’s rough diamonds are cut and polished in the Gujarati city of Surat, a business worth about $13 billion a year, and Indians, predominantly Gujaratis, control almost three-quarters of Antwerp’s diamond industry.Trust and honesty remain essential to Gujarati-dominated industries. Mr Mehta, himself a Jain from Palanpur, whose diamond company has a turnover of $1.8 billion and offices from Antwerp to Tokyo, says that, despite the size of the business, it is still “all based on handshakes and words, with no contracts”. In order to make the system work, he explains, diamond merchants prefer to deal with “the people they trust”—this usually means a group within the Gujaratis, in this case their fellow Jains from Palanpur.Traditionally, most of the finance to start a business comes from within the family, or at least the community.Business failure is also largely handled within families. Gujarati entrepreneurs are risk-takers, but they know that the family network provides a safety net.
5. When the Portuguese, Dutch and then the British started arriving in India from the 16th century they used Gujaratis as their principal trading partners. The headquarters of the British East India Company was originally at Surat.Hundreds of thousands emigrated to east and southern Africa in particular, but also to Malaysia, Burma, Singapore and beyond, as well as more obscure territories such as Fiji.Gujaratis enjoyed similar success in other colonies of the British empire, notably Kenya and South Africa.The intimate connection with the British, however, came at a price. The Gujaratis were identified as little more than colonial satraps by indigenous Burmans, Ugandans and others. So once the British left, they were often targeted by the first post-independence politicians, asserting their nationalist credentials.In Burma (now Myanmar), the military regime that took over in 1962 nationalised all foreign businesses, forcing hundreds of thousands of Indians out of the country. In Uganda, in 1972, the deranged dictator, Idi Amin, abruptly gave the country’s 60,000 South Asians, mostly Gujaratis, 90 days to leave.

Economist 12/18/15

1. When the New York Times and CBS News asked people across America in April whether they expected a terrorist attack in the United States in the next few months, just 44% said it was very likely or somewhat likely. When they asked the same question this month, that figure had climbed to 79%.Yet their anxiety doesn’t seem to be affecting their travel plans—or maybe just barely. Yahoo Travel polled 2,670 American adults, of whom 1,000 plan to travel during the holiday season. Half of them said the recent terror attacks hadn’t changed their feelings about travelling. An additional 44% said they were more nervous to travel, but wouldn’t change their plans.Only 6% reported that they had changed at least some portion of their plans due to terrorism fears.
2. In May 2015, George Osborne, the chancellor, announced that having an elected mayor would henceforth be mandatory for all big English cities negotiating devolution deals.He and his Conservative colleagues, as well as many on the opposition benches, are keen for Britain to import US-style directly-elected mayors with a range of beefed-up executive powers.The first British mayors, taking office in London in 2000 and in smaller towns like Hartlepool and Middlesborough in 2001, were integral to New Labour’s “modernisation” project and driven forward by the personal enthusiasm of the then prime minister, Tony Blair.British policy makers from Michael Heseltine in the 1980s to Mr Blair and now Mr Osborne believe that US-style mayors can help tackle the entrenched problems of Britain’s cities. In their view city councils, with their squabbling factionalism, can hold British cities back. Introducing executive mayors, such proponents argue, allows for decision-making to be streamlined.Currently,Britain remains far more centralised than America, and British mayors still lack most of the fiscal powers enjoyed by their American counterparts.
3. THE Bank of Japan’s move to tweak its programme of quantitative easing (QE) on Friday came from left field.The BoJ began its QE—printing money to buy bonds—in April 2013, and in October 2014 it expanded the programme to ¥80 trillion a year ($660 billion at the current exchange rate), up from between ¥60 trillion and ¥70 trillion a year.The first was to lengthen the maturity of the Japanese government bonds (JGBs) that it is buying, from 7-10 years to 7-12 years, in order to “encourage a smoother decline in interest rates across the entire yield curve”.A second step added a little firepower and an intriguing qualitative twist. The bank will add an extra ¥300 billion to its existing scheme of buying exchange-traded funds (ETFs).To guard against the effects of any shortage of JGBs in the market caused by the central bank’s hoovering-up of bonds, it will now accept foreign-currency-denominated loans on deeds and housing-loans portfolios as collateral
4. Since 1975 America has also distorted it by banning the export of almost all crude oil.On December 18th Congress voted to put an end to the problem by lifting the 40-year-old export ban as part of an omnibus budget bill. Republicans championed the proposal, which is backed by the oil industry. Reluctant Democrats supported it because in exchange they were able to negotiate an additional five years of tax credits for wind and solar power, which they are keen on.It will increase the market for the light, sweet crude pumped out of America´s shale deposits, which may eventually give the fracking industry a fillip. It will give refineries outside America access to a greater variety of oil, enabling them to operate more efficiently.
5. IT WAS described as a “make-or-break” moment for Britain and the European Union. Yet, on the face of it, little happened at last night’s summit of EU leaders to advance Britain’s renegotiation of its membership.Britain’s renegotiation, he thought, particularly over migration of EU workers, needed a political energy boost, and he would provide it.He pointed to growing unhappiness with membership among British voters, and his fear that, in the referendum he has promised, they might vote to leave. And he urged those in attendance to understand that a confluence of factors—the EU’s freedom-of-movement rules, Britain’s open labour market, and its unusual “non-contributory” welfare system, which provides generous top-up payments to low-paid workers—was drawing an unsustainable number of European migrants to Britain.The prime minister’s preferred solution is a ban on in-work benefits for migrants until they have toiled in Britain for four years.

Economist 12/17/15

1. Ryanair, Europe’s second-biggest carrier, provoked such outrage when, in 2010, the no-frills airline contemplated installing coin-operated toilets on its planes and charging passengers £1 ($1.50) or €1 ($1.09) per visit. The incentive wasn’t so much to make a buck off the toilet fees as to get fliers to go before boarding the plane.As an airline spokesman told the Daily Mail at the time: “By charging for the toilets we are hoping to change passenger behaviour so that they use the bathroom before or after the flight. That will enable us to remove two out of three of the toilets and make way for at least six extra seats on board.”The plan fizzled amid a flurry of criticism, but it was still on the mind of Dan Lipinski, a Democratic congressman from Illinois, last week when he introduced the Comfortable and Fair Flights Act of 2015.Mr Lipinski’s bill would ban airlines from charging for lavatory use. It would also give passengers the ability to change flights without a fee if the bathrooms on the plane are not working prior to takeoff.
2. European leaders gather today to discuss the migration crisis. It’s the fifth such meeting in Brussels this year, but at least the agenda features an ambitious new proposal. The European Commission, the EU’s executive arm, wants to create a European border guard empowered to intervene directly in troubled frontier regions, even against the wishes of governments (read: Greece). The plan is well crafted; whether ministers will accept such an erosion of sovereignty is another matter. Other matters are no easier: a plan to redistribute asylum-seekers around the EU is proving extremely hard to implement, and a German proposal for a pan-European scheme to resettle many more refugees directly from Turkey and elsewhere is struggling to gain support.
3. How do modern airlines cut costs without cutting corners?They start by mimicking doughnut-dodging supermodels who watch their weight down to the second decimal place. Airlines bin bulky in-flight magazines, lay thinner carpets and serve food in light cardboard boxes. Some airlines have jettisoned safety equipment emergency water landings on those aircraft that do not fly above water. Seats have become lighter.Such parsimony pays off. Fuel accounts for a third of an airline’s cost and every kilo thus shed reduces $100 from an aircraft’s annual fuel bill.Small design tweaks on modern aircraft, that are not as thirsty as their previous avatars, also help. Southwest Airlines estimates that it burns “54m less gallons of fuel each year” after it installed winglets or upturned wingtips on its fleet to reduce drag. EasyJet, a budget carrier, uses ultra-thin paint that eliminates microscopic bumps on the aircraft’s body to help it cut through air more easily and hence, burn less fuel.
4. On December 16th when the Federal Reserve, America’s central bank, raised its target band for interest rates by a quarter of a basis point, to 0.25-0.5%, after seven years of rock-bottom rates.But it was so widely expected that it had little impact on financial markets.For months, the Fed had stressed that rates would rise when two conditions were met: improvement in the labour market, and confidence among rate-setters that inflation would return to target. Both those hurdles have now been cleared, says Ms Yellen.While the change in rates is small, it may require a big push to implement. To get rates up, the Fed will increase the interest paid on its so-called “reverse repurchase agreements”. These involve selling securities to financial institutions along with an agreement to repurchase them the next day (in effect, borrowing money).
5. IN RECENT years el cepo (or “the clamp”) has made life uncomfortable for Argentines. Introduced by Cristina Fernández de Kirchner’s government in November 2011, currency controls made it almost impossible for ordinary Argentines to purchase dollars, preferred by savers to the inflation-prone peso. The measure was designed to protect the government’s stock of foreign reserves. But it resulted in the creation of a parallel foreign-exchange market.On December 16th Alfonso Prat-Gay, the finance minister named by Argentina’s new centre-right president, Mauricio Macri, announced that he would lift el cepo immediately, allowing the peso to float freely. He had little choice. Exporters were hobbled by the overvalued peso. Importers could not obtain dollars, which starved factories of supplies.The new president has inherited inflation running at around 25% a year, a fiscal deficit forecast to reach 7% of GDP by the end of the year and depleted foreign-exchange reserves.